We have lost around 500,000 workers, investment has stagnated since 2016, and our productivity has dropped dramatically since the financial crisis, said Richard Hughes, head of the Office for Budget Responsibility (OBR), in an interview with the BBC. Assessing the impact of leaving the European Union on the state of the UK economy, he admitted that the country was now facing the “biggest drop in living standards” in history.
Asked by journalist Laura Kuenssberg on March 27 on the BBC, Richard Hughes admitted that leaving the European Union “in the long run” reduces the UK’s overall output by around 4%. compared to if the country had stayed in the EU.
Trying to assess the scale of the losses, the OBR chairman admitted that Brexit had a bigger impact on the UK economy than “other shocks” the country has been facing since the pandemic and due to the energy crisis. Moreover, he stated that Great Britain it is currently facing the “biggest drop in living standards” in history, and real incomes could start to pick up in the next “three or four years.”
“Aftershocks of two significant events”
He added that real purchasing power may not return to pre-pandemic levels until the end of this decade. Hughes cited labor shortages and a decline in investment as the source of the slowdown in economic growth. – We lost about 500,000 employees, “We’ve seen investment stagnate since 2016, and our productivity has dropped dramatically since the financial crisis and hasn’t really improved,” Hughes said.
The Secretary of State for Equal Opportunities, Michael Gove, who was present on the BBC program, blamed the UK’s economic problems war in Ukraine and the pandemic. “We are dealing with aftershocks of two significant events,” he said. Asked whether he accepted the fact that the UK had become a “poorer country”, he replied that “everyone accepts it”, adding that if it had not been for the aforementioned factors, “the rate of growth (of the economy) would have been much higher”.
Brexit – how much has the UK cost?
The Center for European Reform (CER) said in December 2022 that Brexit had cost the UK “a staggering £33 billion in lost trade, investment and economic growth,” the Independent reported on March 26, which was the first to make the report public. A study by CER found that by June this year, the UK economy had shrunk by 5.5 per cent compared to what it would have been had the country stayed in the EU.
Main photo source: PAP/EPA/NEIL HALL